Top Italian Insurer: Arrivederci America

Faced with lawsuits stemming from unpaid Holocaust-era claims and threatened sanctions from state insurance commissioners, Italy’s largest insurer has discontinued writing policies in the United States. The move came as Assicurazioni Generali has taken the lead in paying Holocaust-era claims, offering $500,000 in the last two weeks to 43 claimants.
The president of Generali’s U.S. branch, Riccardo Nicolini, told The Jewish Week that although the American operation had been “extremely small but good,” it needed to expand by buying another company. But, he said, “the Holocaust [claims] created second thoughts.
“If you develop a business, you want to be sure of some protection” from suits and boycotts, he explained. Some state and city officials, including city Comptroller Alan Hevesi, have threatened to boycott Generali and other insurance firms if they did not pay Holocaust-era policies.
In a wide-ranging interview at the offices of The Jewish Week, Nicolini added a human dimension to the ongoing story, asserting that his company felt a moral responsibility to Holocaust victims and their families, noting the frustration he felt when Generali came under attack from Jewish groups several years ago. He spoke, too, of his own ties to the Jewish community of Trieste, where he grew up and where Generali is based.
“We have compassion for those who suffered,” he said, “and our words have been backed by our actions.”
Nicolini said his company is considering a proposal of “integrating” a Holocaust-era settlement fund to be established by European insurance companies with a fund established by 35 German companies to compensate Nazi-era slave laborers. Assistant Secretary of State Stuart Eizenstat would then offer participants in both funds “some kind of protection” against further Holocaust-era lawsuits.
He said Lawrence Eagleburger made the suggestion as chair of the International Commission on Holocaust Era Insurance Claims in a bid to arrive at a final settlement of all claims against the firms.
Nicolini said insurance companies are considering establishing two funds: one to pay all claims, the other to cover heirless policies.
He stressed that there were several factors in Generali’s decision to end its U.S. operations, which comes at a time when the U.S. branch had a 12 percent return on equity from $200 million in policies.
“If you want to be competitive in the U.S. market, you need a critical mass and size here, and to offer a large number of products,” he said.
Nicolini added that Generali was committed to honoring all existing policies for five years, after which it would be free to sell them to another insurer.
In discussing Generali’s commitment to honor Holocaust-era claims, he noted that the communists nationalized Generali’s Eastern European operations after World War II and expropriated its assets. But he said Generali was prepared to honor those policies today, even though “we feel we do not have any legal obligation [to do so].”
“We strongly believe the legal obligation has been transferred to the nationalized companies that took over our portfolios in 1945. But we have taken a moral obligation to bring justice to those people who suffered in the Holocaust.”
Nicoloni pointed out that in 1997, Generali created a $12 million fund in Israel to pay all claims. An independent body overseeing that fund has already paid claims, he said.
Nicoloni said also that the recent offers of $500,000 to the 43 claimants is to be followed shortly by offers to more than 150 others. And he noted that Generali earlier this year turned over to Israel’s Holocaust memorial and museum, Yad Vashem, a list of all of Holocaust-era policies written by the company in Eastern Europe. Yad Vashem is now checking those policies against the names of Jews in its files who were murdered in the Holocaust.
In the interview, Nicoloni noted that Jewish merchants founded Generali in 1831. He said he grew up in a Jewish environment in Trieste, that his aunt helped a Jewish family escape the Nazis by getting them into Switzerland, that his father was imprisoned in Buchenwald when he refused to become a Nazi soldier, and that his wife is half Jewish.
“We have Kohens in the family,” he said. “We feel a strong union with this community.”
Thus, when Jewish groups began raising questions four years ago about the failure of insurance companies to pay Holocaust-era claims, Nicoloni said he was “very sympathetic towards the victims of the Holocaust. At the same time, I didn’t understand why my company was so badly attacked and why so many bad things were being said about my company. … I became extremely tense, seeing this reaction against Generali.”
He noted that in 1939, “when nobody was supporting” the Jewish people in Palestine, Generali invested in Migdal, an insurance company that was established there.
Nicolini also criticized unnamed American politicians for using the current controversy “for political gain.”
In another development, Bank Austria has agreed to “issue a statement accepting moral responsibility” for acts it committed in looting the assets of Jewish depositors during World War II, according to Elan Steinberg, executive director of the World Jewish Congress.
“This goes to the heart of our insistence that there be moral restitution as well as material restitution,” he said.
He added that the agreement no longer exempts 1,400 Austrian companies of any claims that could be made against them. As a result, Steinberg said, there are now discussions about the Austrian companies establishing a humanitarian fund similar to the one German companies are discussing.